The Central American Mezzanine Infrastructure Fund (CAMIF) will provide mezzanine lending mainly for private infrastructure projects, including water and sanitation services, in Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Dominican Republic, Mexico and Colombia.

CAMIF has a proposed target size of up to US$ 150 million (EUR 117 million). The Inter-American Development Bank (IDB) has already approved a senior loan of up to US$ 60 million (EUR 46.7 million) for the fund, with additional funding to come from the Central American Bank for Economic Integration (CABEI), other public entities and private investors.

Mezzanine lending is a financial instrument that combines debt and equity features. It generally takes the form of an interest-bearing subordinated loan with structured exits, including the amortisation of loans, scheduled interest, and equity upsides through conversion rights, warrants or profit participation.

CAMIF will be managed by the Washington, DC-based EMP Global, which specialises in infrastructure funds for emerging developing country markets.

Web sites: Wikipedia – Mezzanine capital - http://en.wikipedia.org/wiki/Mezzanine_capital ; EMP Global, http://www.empglobal.com/

Contact: Javier Molina , CAMIF project team leader, Private Sector Department, IDB, USA, javierm@iadb.org.

Source: IDB, 19 Jul 2006